BBVA: Credit Suisse remains cautious about outlook
(CercleFinance.com) - BBVA now owns 85.
97% of the capital of Garanti Bankasi (activities in Turkey).
The group has confirmed the final purchase of an additional 36.12% stake in the Turkish subsidiary. Following this transaction, Credit Suisse confirms its neutral rating on the stock with a target price of 5.60 euros.
The analyst estimates that the transaction will reduce the current CET1 ratio of 12.7% by 23 basis points (vs. an estimated 34 bp for a 100% stake).
Analysts still believe that the new stake significantly increases the group's reliance on the Turkish subsidiary's earnings, with a cautious view on the country's outlook, which could lead to the introduction of hyperinflationary accounting as early as Q2 22.
Analysts have sharply revised inflation forecasts for the country due to higher commodity prices, negative impacts from tourism in Russia and Ukraine, and the depreciation of the Turkish lira.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
97% of the capital of Garanti Bankasi (activities in Turkey).
The group has confirmed the final purchase of an additional 36.12% stake in the Turkish subsidiary. Following this transaction, Credit Suisse confirms its neutral rating on the stock with a target price of 5.60 euros.
The analyst estimates that the transaction will reduce the current CET1 ratio of 12.7% by 23 basis points (vs. an estimated 34 bp for a 100% stake).
Analysts still believe that the new stake significantly increases the group's reliance on the Turkish subsidiary's earnings, with a cautious view on the country's outlook, which could lead to the introduction of hyperinflationary accounting as early as Q2 22.
Analysts have sharply revised inflation forecasts for the country due to higher commodity prices, negative impacts from tourism in Russia and Ukraine, and the depreciation of the Turkish lira.
Copyright (c) 2022 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.